The next chapter

By the time the New York Home Textiles Market gets under way in 38 days, the consortium of liquidators doing business as GGST LLC will have already concluded its acquisition of Pillowtex's assets and flipped them to a new owner or owners.

That's assuming no last-minute rivals emerge, which hardly seems likely.

In the meantime, the home textiles landscape is transforming rapidly as retailers dole out the business to other suppliers and consider whether this might be the opportune moment to swap portions of their branded businesses for private label programs and the chewier margins that go with them.

There are really two industry-transforming sorts of transaction being conducted right now: one for the shelf space and one for the brands. Much of the former has been or soon will be concluded. That's what's going to make the aftermath of the latter so very interesting to watch.

As is always the case when a large edifice goes boom, the fatal Pillowtex explosion is throwing off some hefty chunks — most of which appear to be hurtling in the direction of Springs Industries at the moment.

Much of the rest will scatter out in bits and in several directions. That's hopeful news to several mid-sized players with the ability to stoke more goods into their distribution systems.

Some of the former Pillowtex business with simply atomize, as though it never existed.

These are the days of unfolding scenarios. There's the Big Retailer Theory, in which a gargantuan, international retailer acquires the Cannon brand and a sizable, more fashion-fixated discounter latches on to Royal Velvet. Could happen, but I'd be surprised. Why would any retailer buy the brand itself when the world is full of suppliers willing to lay out the money and deliver an exclusive?

There's also the Big Supplier Theory, in which a non-bankrupt $2 billion U.S. mill — we have so many of them around, you know — buys up all the brands in one blow. Again, it could happen. Whether it does or doesn't, Springs is likely to emerge from this thing as the home textiles industry's equivalent of Wal-Mart — bigger than all others by a factor that puts it off the charts.

The very latest theory, one of my personal favorites, is the Apparel Giant Theory, in which a VF Corp./Jones/Liz Claiborne-type of brand conglomerate with a massive worldwide sourcing apparatus decides it's time to bulk up on a hearty meal of home textiles.

That the industry has been transformed utterly by Pillowtex's collapse is not in doubt. Overseas mills see in the rubble an opportunity to finally seal meaningful partnerships with the U.S. companies that land the business. And most of the U.S. companies — Springs included — are going to need overseas help because no other company is large enough to swallow the capacity demands whole.

However it plays out, it's playing out quickly. In another 38 days, the industry should have a pretty good bead on where it's all headed.